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Life, Death And How Long Your Money Will Last

Saturday, November 10, 2012 - 8:25 AM
by Scott Burns

How much can we withdraw from our retirement savings without running out of money before we die? The question has been actively discussed and researched by financial planners and academics since the mid-1990s but there is still no hard, definite, answer. This happens because the answer depends on what you assume about the future.

http://assetbuilder.com/scott_bur...y_will_las
3
ShorebreakShorebreak2,674 posts since
Apr 6, 2010
Rep Points: 14,508
1. Sunday, November 11, 2012 - 8:19 AM
Articles like this really irritate me.  Unless you are a psychic, no one can foretell how long their money will last unless they have millions of dollars.  Unforeseenable events, an adult child who has medical problems and/or losses his/her job and needs your total support again, unnaturalable weather events which destroy your assests, expensive medical problems which you think only happens to "other" people etc. etc.   BTW, since certain of our posters are forewarning us that our "dollars" are going to be basically worthless in the near future, even your dollars won't save you. So asking people if they will outlive their savings is a ridiculous question, imo. 
1
paoli2paoli21,400 posts since
Aug 10, 2011
Rep Points: 6,132
2. Sunday, November 11, 2012 - 9:47 AM
Paoli, true, but . . .

I suspect many (most?) folks in their 40s and 50s haven't thought much about retirement withdrawals, SWRs, RMDs, and such. To the extent anybody in the popular financial media can raise the issue, and get folks thinking about "how much is enough", well, that's a good thing. I further suspect that, once folks in their 40s and 50s actually try to figure out "how much is enough", most will discern the obvious: they're way behind the curve. It's probably too late in life (in your 60s) to finally do the math and find out that "nest egg" won't hack it, under any set of assumptions.
4
BozoBozo137 posts since
Feb 14, 2011
Rep Points: 944
3. Sunday, November 11, 2012 - 11:17 AM
Bozo:  I totally agree with you.  I always had the insight (thank goodness) to try to oversave always thinking of the worse things that could happen to us in our senior years.  Guess what?  They did!  If I had just gone with what all the financial articles I read were recommending, we would be in deep dodo now.  So my logic says "oversave" as much as one can so you can survive all the emergencies that can strike in your senior years.  Just depending on Social Security is illogical in my thinking.
1
paoli2paoli21,400 posts since
Aug 10, 2011
Rep Points: 6,132
4. Sunday, November 11, 2012 - 6:26 PM
Re: Paoli2@ 1. Sunday, November 11, 2012 - 8:19 AM
FYI I reread the article two more times and still don't get why it irritates you. Mr. Burns points out the problems of asking the question of how much can we withdraw from our retirement savings without running out of money before we die. He offers an alternative measure. It's far from a ridiculous question. It's the basis of retirement planning.

 
3
ShorebreakShorebreak2,674 posts since
Apr 6, 2010
Rep Points: 14,508
5. Sunday, November 11, 2012 - 7:09 PM
Shorebreak:  I know it is the basis of retirement planning.  That is what I dislike about such articles.  They are totally off base from my experience.  Their sumation seems to leave out of the equation all the problems that can arise.  No one can really know how much they will need to survive until the time comes and they see what they have to face. I am going by my own experience.  Maybe in a perfect life their information would work out but humans I know don't get to live "perfect" lives.  So my theory still is "oversave"!
1
paoli2paoli21,400 posts since
Aug 10, 2011
Rep Points: 6,132
6. Sunday, November 11, 2012 - 7:26 PM
Re: Paoli2 @ 5. Sunday, November 11, 2012 - 7:09 PM

So, it's nice to know that you regard retirement planning articles as useless. Simple, don't read them then if they irritate you so much.
3
ShorebreakShorebreak2,674 posts since
Apr 6, 2010
Rep Points: 14,508
7. Sunday, November 11, 2012 - 7:34 PM
Shorebreak:  "Useless" is your word not mine.  Just because I disagree with an article does not mean it is "useless" for someone else.  I read most articles you post because I have been able to pick information from them that I can still find helpful even if I may disagree with parts of the article.  I would read a book of 2000 pages if it held just one paragraph of knowledge which could be helpful to me.  Until we read something, how do we know if it can be useful or not?
1
paoli2paoli21,400 posts since
Aug 10, 2011
Rep Points: 6,132
8. Sunday, November 11, 2012 - 9:15 PM
Re: Paoli @ 7. Sunday, November 11, 2012 - 7:34 PM

Never mind. You posted: "They are totally off base from my experience." That must mean the articles were obviously of use to you.
2
ShorebreakShorebreak2,674 posts since
Apr 6, 2010
Rep Points: 14,508
9. Sunday, November 11, 2012 - 9:22 PM
Shorebreak:  Maybe you are bored tonight and need entertainment so your reading skills need "honing".   Do you understand what "from my experience" means?  Why do you have to twist my words?  Next time I'll post in German and maybe you can understand better.
1
paoli2paoli21,400 posts since
Aug 10, 2011
Rep Points: 6,132
10. Sunday, November 11, 2012 - 10:16 PM
Some posts do not seem to be making it to the thread yet I am getting emails on them.  Anyone know why?  Thanks.
1
paoli2paoli21,400 posts since
Aug 10, 2011
Rep Points: 6,132
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